The rupee pared most of its early gains to trade near its all-time low of 70.39 a dollar despite weakness in the U.S. dollar.
The domestic currency opened 0.16 percent higher at 69.79 against the dollar but slumped 0.24 percent intra-day to trade at 70.07.
“The rupee erased morning gains amid month-end dollar demand from importers,” Bloomberg reported quoting Edelweiss Securities' Sanjay Gupta. “The rupee came under pressure even as other Asian currencies were higher.”
The Indian currency snapped its two-week losing streak on Friday and closed 24 paise higher at 69.91 against a dollar. But it still remains the worst performer in 2018. So far this year, the rupee has depreciated 8.8 percent.
“The rupee is likely to average at 69 per U.S. dollar this financial year, driven by stronger domestic macro fundamentals and foreign fund flows,” newswire PTI reported quoting Bank of Baroda's research report. “While the near-term volatility can't be ruled out as the rupee is highly correlated with other Asian emerging market currencies, we believe the local currency should stabilise sooner than later.”
Gupta expects the rupee to trade at 69.50-70.50, Bloomberg reported. But, he said, the currency can accelerate its drop to 71-level if trades near 70.25.
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